HomeWell Care Services: Litigation & Risk
Senior Care · FDD Items 3, 4 & 5
Moderate: Review
2 cases disclosed in FDD Items 3 and 4.
FDD Items 3 & 4
Litigation Metrics
- Cases disclosed
- 2
- Total from FDD Items 3 and 4
- Bankruptcy (Item 4)
- None
- Franchisor or officer bankruptcy
- Verdict score
- 100 / 100
- FranchiseVerdict composite · higher is better
- Rating
- A
- A / B / C / D / F verdict grade
7(a) FOIA data · FY2020–present
SBA Loan Performance
Aggregated from public SBA 7(a) loan disclosures. Charge-off rate is the share of loans that were charged off or settled for less than the full balance.
- Total 7(a) loans
- 31
- Government-backed loans issued
- Charge-off rate
- 0.0%
- vs 16% franchise average
- 5-yr charge-off rate
- 0.0%
- Defaults
- 0 loans
- Loans charged off or defaulted
- Total loan volume
- $4.8M
- Avg loan size
- $156K
- Participating lenders
- 9
FDD Items 5, 6 & 17: What You Give Up
Contract Risk Indicators
- Mandatory arbitration
- Required
- Disputes resolved outside court, limits your legal options
- Jury trial waiver
- Not waived
- Non-compete
- 2 yrs
- Post-termination restriction on similar businesses
- Franchisor can compete
- Yes
- Franchisor can open competing locations in or near your territory
- Right of first refusal
- Yes
- Franchisor can match any purchase offer when you try to sell
- Governing law
- TX
- State whose law governs disputes. Relevant if you're not based there
Extracted from FDD Item 3
Litigation Detail
1) California DFPI consent order (Jan 2024) for franchise law violations. 2) Junzi Holdings v. HomeWell (AAA arbitration, 2020-2021) — franchisee claims denied except negligent representation; HomeWell ordered to pay $112,634 plus interest and AAA fees.
What drove the 100/100 verdict
Risk Score Breakdown
- 01MINOR2024 California regulatory Consent Order regarding misrepresentation of financial performance and registration compliance—active regulatory scrutiny
- 02MINOR2020-2021 arbitration loss with damages award signals contract enforcement issues and prior misrepresentation claims with area representatives
- 03MEDNo Item 19 (Average Unit Volume) disclosed despite $2.19M average revenue—lack of transparency on franchisee profitability metrics
- 04MINORUnprotected territory creates direct competition risk from other HomeWell franchisees and company-owned locations in same market
- 05MINOR5% royalty on gross (not net) revenues means franchisees pay royalties even during unprofitable periods
- 06MINORStrong YoY growth (23.4%) may reflect aggressive recruitment rather than franchisee success—unit growth without profitability disclosure is concerning
Severity inferred from FDD text. Not a regulatory or legal classification
Litigation data from FDD Items 3, 4, and 5. SBA data from public 7(a) FOIA records (FY2020–present). Not legal advice. Consult a franchise attorney before signing any franchise agreement.